We often recommend mediation to our clients – it often helps to resolve lawsuits quickly and efficiently. However, there are some important issues to be aware when referring clients to mediation. Most of these center around the mediation confidentiality agreement (MCA).
Obviously, mediation would not work without assuring confidentiality. But often, parties sign away rights without realizing it when they sign an MCA. That’s why it’s important before signing any MCA to ask questions about confidentiality and privilege:
All these questions revolve around the nature of mediation: the process must be confidential, but if it is too well-shielded from the court system, then parties may be barred from using potentially valuable information following the mediation process.
The highest-profile example in recent years was a settlement agreement between the Winklevoss twins, Internet entrepreneurs who sued Facebook, claiming that during mediation owner Mark Zuckerberg had misled them about the value of their shares. The court ruled that the Winklevosses’ information about the alleged fraud was inadmissible because it had emerged during protected mediation proceedings.
It’s crucial to understand exactly what is and is not permitted under the MCA. As an attorney, you may even be barred from disclosing certain information to aid your client later on down the line if it was originally shared within the framework of mediation.
Different standards for confidentiality apply from state to state, so don’t make assumptions about which standard will apply. Before entering any type of mediation, understand the protections extended automatically by virtue of the jurisdiction, as well as the specifics of the MCA.
One useful change to a “standard” mediation agreement is to remove clauses referring to mediator conduct. These often prevent attorneys from protecting their clients’ best interests in the event that the mediator fails to uphold professional standards.
None of this changes the value of mediation to save clients vast amounts of time and trouble. Confidentiality will always be an essential part of mediation. However, attorneys recommending mediation should be aware of jurisdictional rules, as well as of opportunities to modify a boilerplate confidentiality agreement to maximize clients’ rights and preserve potential future claims if any issues remain unresolved following mediation.
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Obviously, mediation would not work without assuring confidentiality. But often, parties sign away rights without realizing it when they sign an MCA. That’s why it’s important before signing any MCA to ask questions about confidentiality and privilege:
- What level of confidentiality does the MCA ensure?
- What level of privilege does the MCA provide?
- What level of admissibility is there for information divulged during mediation?
All these questions revolve around the nature of mediation: the process must be confidential, but if it is too well-shielded from the court system, then parties may be barred from using potentially valuable information following the mediation process.
The highest-profile example in recent years was a settlement agreement between the Winklevoss twins, Internet entrepreneurs who sued Facebook, claiming that during mediation owner Mark Zuckerberg had misled them about the value of their shares. The court ruled that the Winklevosses’ information about the alleged fraud was inadmissible because it had emerged during protected mediation proceedings.
It’s crucial to understand exactly what is and is not permitted under the MCA. As an attorney, you may even be barred from disclosing certain information to aid your client later on down the line if it was originally shared within the framework of mediation.
Different standards for confidentiality apply from state to state, so don’t make assumptions about which standard will apply. Before entering any type of mediation, understand the protections extended automatically by virtue of the jurisdiction, as well as the specifics of the MCA.
One useful change to a “standard” mediation agreement is to remove clauses referring to mediator conduct. These often prevent attorneys from protecting their clients’ best interests in the event that the mediator fails to uphold professional standards.
None of this changes the value of mediation to save clients vast amounts of time and trouble. Confidentiality will always be an essential part of mediation. However, attorneys recommending mediation should be aware of jurisdictional rules, as well as of opportunities to modify a boilerplate confidentiality agreement to maximize clients’ rights and preserve potential future claims if any issues remain unresolved following mediation.
Image Credit
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